A Billion Dollar Reason Why Linux Works

April 4, 2012

By
Sean Kerner

Money is not what makes the Linux Planet go around, but it sure doesn't hurt. This past week the Linux Plant celebrated its first billion dollar company as Red Hat reported its fiscal 2012 results. While the Red Hat milestone is significant, work continued on the mainline kernel and at rival distribution Ubuntu.

1. Red Hat's Billion

Open Source and Linux software is all about being free, as in the freedom to do what you want with software. Linux does not mean that you can't make money though; just ask Red Hat. The Linux leader reported its fiscal 2012 results with revenues coming in at $1.13 billion. Red Hat is the first pure play open source or Linux vendor to generate a billion dollars in a year.

Red Hat's revenues come from a strong showing for its Linux solutions across multiple market verticals, notably financial services and government. The company has also been successful at growing its JBoss middleware business as well, which has also been a strong contributor to Red Hat's bottom line.

Red Hat has also been growing its revenues by converting free Linux users to paying users that see value in a Red Hat subscription. Red Hat's flagship release Red Hat Enterprise Linux is sold on a subscription basis and competes against free rival including clones like CentOS.

While Red Hat's revenues are generated by its strong sales force and partner sales channel, they have not strayed from their open source roots. Red Hat CEO Jim Whitehurst hailed the billion-dollar milestone as a victory for open source advocates everywhere.

"Our fight has always been about something greater than just access to software code," Whitehurst stated. "The open source movement is rooted in shared values about knowledge; it is founded on ideas that are both ordinary and revolutionary. As members of this community, we elevate transparency over secrecy."

2. Ubuntu 12.04 Beta 2

Currently,Red Hat does not have any public rival that is anywhere near the billion-dollar revenue milestone. That said, Ubuntu Linux is trying to gain share and is revving up the final development milestones for the upcoming Ubuntu 12.04 Precise Pangolin 1enterprise release.

The second beta for Ubuntu 12.04 was released last week, marking the final beta release for the platform. Full general availability for Ubuntu 12.04 is currently set for April 26, 2012.

3. Linux 3.4 RC 1

At the heart of Red Hat's billion-dollar empire and at the core Ubuntu's Pangolin too, is the Linux kernel.

This past week, the first release candidate for the third Linux kernel of 2012 was released. The first Linux 3.4 kernel release candidate followed the final release of Linux 3.3 by only 13 days.

Sean Michael Kerner is a senior editor at InternetNews.com, the news service of the IT Business Edge Network, the network for technology professionals Follow him on Twitter @TechJournalist.